Are you looking to buy your dream house? You go through an exciting and exhausting process of house hunting and eventually end up with a lovely house of your choice at a budget that you can afford. Yet so many people commit horrible errors in judgment while buying a home for the first time. We will help you demystify the process by discussing the common mistakes made by first-time homebuyers and enable you to make an informed decision.
• Not respecting your budget limit: Most often first-time homebuyers go a bit giddy while shopping for houses and try to stretch their budget for a granite floor or a penthouse. Surely, when you are dealing with such large numbers, an additional $10,000 may look affordable and that’s a risky path to take. There can always be a scenario where your income may diminish or you have to change jobs. So, always keep your monthly budget in your mind while looking for houses.
• Failing to take additional expenses into account: Once you become a homeowner, you have to bear the additional expenses like home insurance, property taxes, maintenance and utility costs apart from your monthly payments. Forgetting to take these additional expenses into account may as well lead to you overshooting your budget by a long shot.
• Not applying for Pre-approved Mortgages: If you have a poor credit history or an unstable source of income, applying for a pre-approved loan before placing an offer on a house or even estimating your house budget is a must. Because, your perception of how much you can afford and the bank’s perception may differ by a significant amount and taking things for granted may as well put a hold to your dream.
• Neglecting to extensively study the legal contract: Don’t assume anything unless it is present in the legal contract. More often than not the anticipation of the home buyers are not met by their dream homes, be it the missing kitchen appliances they assumed to come with the deal or the light fixtures, showers or bath fixtures that are broken. So, make sure that everything that comes with the deal goes into the contract too.
• Skipping the Inspection: In spite of how much exquisite the house may look, failing to conduct a thorough inspection by a professional would be foolish. An inspector knows the critical things to look for and has the necessary expertise to comment on the signs of water damage or cracks in the foundation. If conditions with requirements of repairing do exist, you’ll have the advantage to negotiate with the seller and therefore, making an inspection a win-win investment.
• Compromising on the things that matter: Always remember that buying a home is a major purchase decision. Although some sacrifices and compromises must be made to afford your dream home, do not let that cloud your vision. If you plan to have kids soon, don’t get a small apartment just because it’s affordable.